As I write, Nick Clegg and Vince Cable are setting out the framework of ‘the party’s tax policies, the philosophical basis that underpins them and the contrast between the Liberal Democrats’ policies and those of the other two parties.’

This has been well trailed in the media this morning, with Nick conducting a series of media interviews. Much focus so far on the tweak to the ‘mansion tax’ proposals that Vince mooted at conference to public acclaim, but some disquiet among his own Parliamentary colleagues (many of whom knew nothing about it in advance).

The party has responded to criticisms made of the tax, especially in marginal seats in the south of England, by lifting the threshold at which the annual levy is paid to cover all houses worth more than £2m, and doubling the levy from 0.5% to 1% to ensure even more money is raised by the new tax.

The revenue raised from this and other measures (such as green taxes) will be ploughed back into the party’s spending priorities, including raising the tax threshold for the poorest in society.

The Liberal Democrats have doubled the threshold at which they say homeowners should pay an annual “mansion tax”. Properties will now have to be worth at least £2m to incur a 1% charge – the previous plan was to charge 0.5% a year on a property’s value above £1m.

Party leader Nick Clegg said the “principle” remained the same but “we just looked at the figures”. The party is also pledging to scrap income tax for four million people earning less than £10,000 a year. …

Mr Clegg told BBC One’s Breakfast: “The principle is very clear. People who live in very large houses, mansions, should pay some more money, so we can give some back to the majority of British taxpayers. It does what it says on the tin. It’s a mansion tax. It goes towards what many people want from the tax system. Nothing has changed in terms of the principle… We are the only party in British politics who have a plan to make taxes fair. This is a simple, fair, do-able plan.”

Liberal Democrat Leader Nick Clegg today pledged to put fair taxes at the heart of the party’s message to the British people.

The party’s new tax plans will see tax cuts for millions of people, paid for by closing tax loopholes, making polluters pay and introducing a ‘mansion tax’ on homes worth over £2m.

Nick Clegg said:

“If you want to know how committed a government is to fairness then look at its tax system.

“Gordon Brown has created a tax regime that forces some of the lowest earners in society to pay hundreds of pounds in tax they can’t afford, while polluters and rich tax dodgers avoid paying their fair share.

“Meanwhile the Conservatives want tax cuts for millionaires, but say there might be tax rises for everyone else.

“Under our plans people won’t pay a penny on the first ten thousand pounds they earn. That would put £700 back in the pockets of the vast majority of tax payers, and take millions of people on low pay out of paying income tax altogether.

“Our plans represent the most radical, far reaching tax reform in a generation.

3 Comments

A tax is either fair or not. You can not change the plans to suit ‘marginals in the south east’. Given that you only need 42% to get a majority, why not say anyone with a surname begining A to M has no tax, the rest pay double. Its not fair, but would get enough votes to get you in.

The houses were bought with taxed income, seems unfair to tax retrospectively. What about massive mortgages?

If its votes you are after, tax minorities more too, that would get the BNP’s share of the votes. Who else would the majority not mind paying up? Yes… Politicians, they can have 80% tax too.

Isn’t it just typical of our party, that despite having a really fantastic and very sellable story on tax – taking 4 million out of tax by raising the threshold, paid for by making pensions relief fair and bringing CGT back in line with IT – we completely lose the plot and the headlines because Vince has to have his mansion tax in there too.

The mansion tax is a potty and ineffective idea that was thrown out by the working group and rejected very publicly by FPC in September. By persevering with it the leadership has ensured that this is the headline that people will read and all the good news about our zeal for tax reform is lost in the ether.

When will they realise its not about posturing, its about getting the message across clearly and effectively?

[…] tax – the launch of which the Grauniad notes was a ‘fiasco’ – when, again, it was the FPC which determined the policy which will be in the manifesto: a 1% annual levy on householders with homes worth more than […]

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